Create does not mean add a value to field that did not have value before. I believe it means when you are creating a record do you have access to the attribute.
By setting the Create to No, you would not have access to this field when creating a new record. But with Read and Update set to yes, the user has the privilege to see the values held in this field and with the Update permission also update the value of
the field even if no value existed earlier.
The default functionality is to return encrypted value. However, through custom scripting you can hide the fields on the form. But in that case, it would involve complex code of first retrieving when a user has permission to the field and if no then hiding
the field.
HTH
Sam
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